All Forum Posts by: Matt Devincenzo

Do you owner occupy this same tri-plex, and are you in a rent controlled area of LA? 

There are several avenues to consider here, and I'm sure you can get her out but depending on the above answers it may be easier or harder, cheaper or more expensive. Which leads to another question, what is your specific ability to finance a solution? Could you invest $10K, $100K, $500K if needed? 

There are going to be three levels of addressing this 1) things you can simply go there and do anytime (pick up pet waste and throw it away) 2) things you can do given proper notice (enter the unit and inspect, repair damage etc) and 3) things you can only do given proper process/procedure (notice to vacate, increase rent etc.) You need to answer all the above questions, then identify a course of action based on those answers, and then place those actions into the three categories above. Start doing category 1 items right away, provide notice and do category 2 as soon as you can and finally prepare and get ready to initiate category 3 items based on your ability to handle them. 

What's the objective? A place that the family always thinks of and goes to for reunions or vacation? Possible income and wealth for future generations? A business/way of life to continue? 

Overall most of those may be overrated. My Mom's family grew up with two generations of the local family get togethers and knowing all the extended cousins, so did my wife's family. Now in the third generation most of us don't do it because there's a separation in what my immediate family values, and what the extended family values. We still see one another, but it's not the close family ties that once existed. I know people who currently have that, it started a generation ago and probably ends next generation, it's hard to maintain this more than a couple generations because the politics, religion and underlying values can't hold across hundreds of extended family members.

The same goes for business/way of life. Look at any farming family and most have left the industry...same for fishing, timber etc. 

Finally wealth creation, this I'd do it for. But not for future generations. Maybe they benefit and that's great, but a large part of valuing wealth and what it afford comes in the struggle to obtain it. My kids may end up receiving an inheritance assuming they already value it...and if they don't then they'll get a token amount. That remains to be seen, but none of my planning is to provide them anything more than initial opportunity.

You can just add another account to pay from Venmo and then use that account when you have a 'business' charge vs. personal. Using the same platform itself isn't an issue its the source of the funds you want to keep separate. 

Also not to minimize the issue, but if you are operating as a sole prop or pass through entity the actual damage from a mistake when selecting the account is minimal. It will have no bearing on your end of year taxes and is easily fixed on the admin side if you make a mistake. 

Agreed with the above, I'd waive the fee for a good tenant. Sticking to the lease in this case will only cause you more problems, not less. 

As far as the record goes, you can search the County Recorder for death certificates. So I'd give that a quick try before asking the tenant for it just to try and avoid asking. If I can't find it in a 15 min search at the recorder, then I would go ahead and ask. 

As far as the SD, disperse it as usual...apply any damages and refund the remainder. Depending on the lease and receiving the death certificate send the check to either "the estate of XXX" or if Dad was also on as a financially responsible party I'd make it out to "Dad, or the Estate of XXX" so he could deposit it himself. 

I'm not sure why you're disappointed. Having tenants that I can screen, get on a lease I want and at a rate I want are all good things. If the current MtM tenants fit that profile, great! If not I can replace them without waiting until Aug, great! 

Why would you expect a price reduction when there is no impact to value from having a lease or not?

There's nothing specifically wrong with your proposal, but I'd just do a rate and term conventional refi and forget the LLC. The DSCR will still have a personal guarantee, and whether reported to the credit bureaus or not it needs to be disclosed as a debt, so there's no benefit there. Your conventional options will likely be better and keeping in your personal name is much easier to manage...just my 0.02

Your looking for a 'servicer'...it isn't SaaS it is an actual service provider that will handle this. If you search the term you'll find several recommended...FCI, Madison, Evergreen, BiFi, Allied are a few that come to mind. 

As far as note structure, you'd be considering either a "sub-to" with a owner carry 2nd, or a "wrap" around first. Personally I'd suggest the wrap will give you a higher protection on default. If they stop paying you can foreclose, with the sub-to and a 2nd they could stop paying the first but keep paying you. That could potentially place you in a more difficult position to foreclose. 

And many times these deals are a bad idea. You should really consider 1) what benefit are you getting from this 2) what benefit does the buyer get? I've sold 3-4 on OF so I'm not opposed, it just seems like a lot of the recent questions for this are focused on more money without recognizing the risk you're accepting.

I think this is a State specific legal ruling in WI if I recall correctly. I'd personally find the attorney for your new lease and ask him how to address it. If you simply ask the tenant to resign the lease and then there were issues I could see them claiming deception to coerce a lease signing, so at minimum I'd likely shar with them there was a recent court ruling and you need to revise to make your lease legal.

That said even if your lease is void I believe the tenancy would be governed by State law. So it isn't a complete waste, you would simply need to follow the strict reading of the law with no private clauses for consideration...I'm not sure how that plays out since technically if the lease is void, so is the tenancy meaning you could terminate anytime and not wait for the original lease expiration...I'm sure that's covered somewhere, but again I'd ask my local atty what to do given this is such a locally specific issue. 

Like the above poster mentioned, the issue is probably loan type more than the tax agreement. Typically HELOC lenders don't escrow since they're often set up to be in 2nd and rely on the first to check tax/ins more regularly. By pursuing it as a first that's likely where their issue is coming in. I'd look for a cash out refi that includes escrowing the tax/ins as that will probably eliminate the issue.

I haven't done one like this, but I would agree an addendum is the best way to add the extra details. The other things to keep in mind utilities, cleaning before/after (fee, does it need to be dictated?), any personal items to be removed/locked up etc? Otherwise it seems like it should work well enough.